Govt to create Tk 1000cr fund to boost jute output

The government is planning to creat a Tk 1000-crore special fund to boost the production of jute for earning more foreign exchange after meeting the local demand.

Prime Minister Sheikh Hasina on March 6 officially declared that jute and jute goods will be considered as agro-based products so that this foreign exchange-earning sector could get all the benefits the country’s other agro-based items get.

According to an official document , a process is underway to accept a proposal for increasing the cash incentive for this sector from 7.5 percent.

It also mentioned that the government is considering creating a special fund of Tk 1000 crore, like the Export Development Fund (EDF) of Bangladesh Bank, at a 2 percent interest rate.

“The formation of the fund is underway, jute and jute goods exporters can get low-interest loans from the fund,” the document said.

Currently, exporters producing products using imported raw materials are getting loans at only 2 percent interest rate from the EDF.

According to officials at the Textiles and Jute Ministry, the government has taken the initiative to revive the past glory of the country’s jute industry.

The country earned US$167.84 million from exports of raw jute and US$794.58 million from jute goods in 2016-17 fiscal year.

Of them, People’s Jute Mills, Quwami Jute Mills, Karnaphuli Jute Mills and Forat-Karnaphuli Jute Mills were shut down on July 31, 2007 during the caretaker government.

The government resumed the operation of People’s Jute Mills on March 5, 2011 while Quwami Jute Mills went into operation again on April 9, 2011, and Karnaphuli Jute Mills January and Forat-Karnaphuli Jute Mills on 26, 2013.

According to the official document, the government has taken steps to conduct BMRE (balancing, modernisation, renovation and expansion) of 26 jute mills which are 50-60 years old gradually at a cost of Tk 6000 crore with the assistance of China.

The government also made it mandatory to use jute bags for packaging 17 items under a law formulated in 2010.